Pernod Ricard and Brown-Forman are negotiating a merger that could create a spirits industry powerhouse, according to people familiar with the matter. The Paris-based company, known for Absolut vodka and Jameson whiskey, is discussing a deal with the Louisville-based maker of Jack Daniel's that would be primarily stock-based.

Both companies face slowing alcohol sales, making this potential combination strategically significant. Pernod Ricard, with a market value of around $17 billion, oversees 200 spirits brands including Beefeater gin. Brown-Forman, valued at approximately $12 billion, is best known for its whiskey portfolio but also owns other spirits brands.

The deal could materialize within weeks if negotiations succeed. The structure would likely preserve family ownership stakes, with both companies' founding families retaining significant positions in the merged entity. This would mark one of the largest consolidations in the spirits industry in recent years.